European Union (EU) regulators are scrutinizing Binance’s continued access to customers in the bloc after the world’s largest cryptocurrency exchange was required to wind down its business for failing to obtain a licence under the European Union’s Markets in Crypto-Assets (MiCA) regime, according to a report by the Financial Times (FT).
Binance is reportedly relying on a ‘reverse solicitation’ exemption which allows non-EU financial firms to serve customers who independently initiate a relationship with them. European Securities and Markets Authority (ESMA) officials have stressed that the exemption is narrowly defined and should not be used to circumvent MiCA licensing requirements.
REGULATION | Binance Users in Europe Can Now Transfer and Withdraw Crypto Assets Following MiCA License Denial
National regulators, including those in
France,
Germany, and
Greece
are examining Binance’s use of the exemption and have sought information from the exchange. Regulators could impose fines or take further enforcement action if they conclude Binance is operating outside the scope of the exemption.
REGULATION | BitPanda Fined €70,000 in Austria’s First Published MiCA Penalty
Binance told the FT it was working toward MiCA authorisation and complies with applicable requirements in the jurisdictions where it operates. Reuters said it could not immediately verify the FT report while Binance and ESMA did not immediately respond to its requests for comment.
The dispute puts reverse solicitation under MiCA under closer scrutiny as regulators seek to prevent firms without EU-wide authorisation from continuing to serve European customers through exemptions intended for limited, customer-initiated relationships.
INSIGHTS | Why a MiCA Licensing Setback for the World’s Largest Exchange Matters
Stay tuned to BitKE for crypto regulatory developments globally.
Join our WhatsApp channel here.
Follow us on X for the latest posts and updates
Join and interact with our Telegram community
___________